MCP is still great if you're running AI in an environment that precludes a shell while needing dynamic tool discovery, but that's a narrow set. People are learning how useful it is to give AI access to a shell. If you're giving them a shell, may as well give them a CLI.
However, I don't think that's what is really hurting MCP, because it could evolve. What really killed it was the standards process and enterprise groups getting ahold of it. It went into spec writing and got adjudicated into uselessness all while enterprise authentication groups were figuring out the best angle to make money on it. I listened to a pitch from Okta on MCP and they wanted to charge out the nose for it for no good reason.